International banking was greatly affected by the 9/11 event that laws and regulations were revised, removing the concept of banking within a bank.  All banks were required to put up physical offices with all the bank equipment and employees present.  This caused the disintegration of the “Offshore Bank in a Box.”  This concept included the purchase of a banking corporation with offshore license and fully operational inside an offshore bank.  What one had was a web-based online bank.  It meant private banking at its best where assets are set inconspicuously with other bank assets.  Loans and securities could be opened securely and privately.

Fraudulent Non-Bank Surrogate

Nowadays, we see some banking products sold over the Internet.  We’ve seen Swedish Credit Unions and New Zealand corporations offering financial services which claim that they can operate both as onshore and offshore bank to anyone who’s interested.  One should not be easily persuaded because, for such channels to work properly, universally accepted currencies should be used.  A correspondent bank is necessary to do this, and not one country will allow this without any physical offices.  Should a correspondent bank go against this rule, they will most likely be fined, and they might even lose their license.  One might initially get in a correspondent bank, but once uncovered, one can be marked for bank fraud and lose his funds to these banks.

Getting Real Offshore Banking Started

One should prepare to post millions of dollars as cash deposit with the government where you intend to put up our business.  Fees for legalities could come up to hundreds of thousands of dollars more.  One should start looking into locations and tellers and the board of directors, etc.  Get the appropriate business licenses first then correspondent banks after, which will take a few more months to the tune of $200,000 annually.  To be doubly sure one could get this thing off, acquiring an operating institution would surely help.

An important ingredient to really make this a successful venture is marketing.  More customers will not necessarily mean better for the offshore bank.  Additional services through credit cards, debit and ATM cards, personal and business loans, stocks, etc. can be profitable too.  The offshore bank should be able to compete with other institutions by offering a wider range of banking services so that customers will willingly do banking with you instead of move to other banks for their other needs.  Marketing is the name of the game.  Some banks may not profit more even if their services are better due to lack of adequate marketing.

Panama Banking

Panama offers a variety of banking opportunities from offshore banks to full banks.  This will require the usual licenses and fees as compliance is mandatory in this jurisdiction.  Other offshore banking services such as loans and savings accounts are also available although checking accounts are not.  This requires less funding and costs, too, although less services are made possible with such.  Trust companies will only require an office and capital of $250,000.  This could be a profit-generating venture with adequate marketing tools.